MyPE

Community Business Directory, Event Listings, News and Views from Gqeberha, Nelson Mandela Bay

Appointment of a tenant as trustee

By

Hi
Can you please advise whether a tenant can be appointed as a trustee and where I can find the relevant section in the Sectional Titles Act

Regards

Jayshree

Regards
Jayshree Thaker

Editor: I have been in the situation of being appointed as a trustee and not owning a unit, but you need to check the Prescribed Management Rules for your scheme comply to make 100% sure.

In accordance with Section 35 of the Sectional Titles Act schemes “..shall as from the date of the establishment of the body corporate be controlled and managed, subject to the provisions of this Act, by means of rules.” These are your ‘management rules’:

5. Qualifications:

Save for the provisions of rule 4(2), a Trustee or alternate Trustee shall not be required to be an owner or the nominee of an owner who is a juristic person, in order to qualify for office as a Trustee; Provide that –

The majority of the Trustees are owners, or spouses of owners; and
The managing agent or any of his or her employees or an employee of the body corporate may not be a trustee unless he or she is an owner.

So the short answer in the above case is yes a tenant (non-owner) may be a trustee only if there are more owners as trustees than non-owners.

See also – Appointment and Removal of Sectional Title Trustees which says:

Jonker says the Management Rules, which regulate the appointment of trustees, stipulate that he or she is not required to be an owner or the nominee of a juristic owner to qualify for office.

“The only proviso is that the majority of trustees must be owners or spouses of owners, and the managing agent or an employee of the managing agent may not be a trustee unless he or she is an owner.”

Writing for Paddocks, Zerlinda van der Merwe says; ” Prescribed Management Rule (PMR) 5 provides that a trustee [is] not required to be an owner provided that (a) the majority of trustees are owners or the spouses of owners; and (b) the managing agent or their employees, and the employees of the body corporate may not be trustees unless they are also owners within the scheme.”

On the question of remuneration van der Merwe says; “Trustees who are owners are not entitled to remuneration for their time and services, unless otherwise determined by special resolution of the members. However, the body corporate may agree, in terms of PMR 10, to remunerate trustees who are not owners. Trustees (owners and non-owners) are entitled to be reimbursed for all disbursements and expenses actually and reasonably incurred while carrying out their duties and exercising their powers.”

The following two tabs change content below.

Port Elizabethan

This author is a 'catch-all' for occasional articles and letters written to MyPE. The Author of each article can be found in the signature at the bottom of each individual article.